As described in the ProcureCon CPO study 2022, in the realm of procurement, sustainability, digital transformation, and strategic alignment have become paramount. This shift from the traditional back-office role to a pivotal value driver has exposed procurement to new challenges, but also presented opportunities for game-changing impact.
In this blog post, we dive into the importance of establishing a sustainability framework for procurement, the evolving role of Chief Procurement Officers (CPOs) in 2022, and strategies to enhance the effectiveness and efficiency of procurement processes to help you navigate the complex terrain of modern procurement and explore potential solutions to its most pressing challenges.
Why You Need a Sustainability Framework for Procurement
C-suite's sustainability goals and procurement's perspective are often misaligned. Procurement must embed continuous ESG insights, translate goals into strategy, and adopt an ESG-enabled framework across functions.
CPOs Focus on Stability, Process Improvement, and Internal Negotiations in 2022
CPOs face challenges in gaining buy-in, implementing new technologies, and adapting to supply chain disruptions. Focus areas include process improvement, supply chain disruption mitigation, sustainability improvement, and inflation mitigation.
Procurement Transformations Could Be Aided by Staffing and Revenue Operations Assistance
Many organizations plan to transform their procurement function and seek assistance in identifying revenue opportunities and staffing. Also, cloud-based procurement platforms and specific tools provide value in improving efficiency and decision-making.
Compliance Tracking and Supplier Performance Management are Key BPO Services
BPO services are crucial for agile procurement. Compliance tracking, supplier performance management, and sourcing support are sought-after services. BPO partnerships should align with long-term strategies and transformation goals.
Some Procurement Teams Need More Resources to Reach ESG Goals
ESG policies should be incorporated into procurement operations, but resource constraints hinder some organizations. Demonstrating ROI and aligning ESG investments with business goals are crucial for securing resources.
Key Recommendations:
- Provide evidence of the benefits of investments to gain internal buy-in.
- Seek partners for staffing and revenue operations assistance.
- Conduct an audit of BPO relationships and prioritize compliance tracking and supplier performance management.
- Ensure resources support ESG goals and demonstrate the value of procurement's ESG policies.
Conclusion
CPOs play a strategic role in reducing complexity, encouraging technological development, and leading digital transformation efforts. They are involved in major business decisions and must provide sound judgement for technology, process, and digital transformation initiatives.
